Ch 20: Agreement of Sale Flashcards
What is the possible criminal fine for a real estate licensee giving legal advice to a client?
Criminal prosecution, punishable by up to one year in prison and a $2,500 fine
To avoid fraud charges, what two contract elements must be met?
The statute of frauds requires that any offer to purchase a property must be in writing and signed by the buyers.
Why is not always a good strategy to present a really low-ball offer?
A price that is too low can cause the sellers to reject the offer outright.
What type of buyers are most attractive to a seller?
Buyers who can pay in cash and take the loan approval process off the table entirely.
Why should you avoid making an offer over the phone to your sellers?
Sellers cannot accept an offer over the phone, but they can certainly reject one. Do whatever it takes to avoid a telephone presentation.
What is the true meaning of a counteroffer?
A counteroffer is in effect a rejection of the original offer and submitting a counteroffer gives the buyers a way out.
What does it tell the seller, if a buyer puts down $500 on $800,000 property?
A small earnest money deposit shows that the buyers are not very serious.
What is a licensee’s duty to seek other buyers, when the seller has already accepted another offer?
Pennsylvania law states that a licensee is not obligated to seek additional offers when his or her client is subject to an existing contract.
What is the rule regarding when a broker must deposit earnest money?
A broker must deposit the earnest money into an escrow account by the end of the next business day following its receipt in the real estate office where the escrow records are maintained.
When must a sales person licensee give his or her broker received earnest money?
All deposit must be given to the broker promptly.
In Pennsylvania, periodic, unannounced, routine inspections by the State Real Estate Commission can be conducted up to how many times per year?
Inspections can occur up to 4 times a year.
What account should a broker use to deposit escrow rent monies?
A broker should deposit rents received into a rental management account that is separate from the broker’s escrow and general business accounts.
What entity issues a highway occupancy permit?
The Department of Transportation
Typically, when a buyer defaults on an agreement, what happens to the earnest money?
Often when a default occurs, it is decided that the sellers will keep the earnest money deposit as damages.
What entity must be the one to sign the purchase and sale agreement of an estate?
The executor of the estate
What does it mean if a deadline for some performance is not met by the specified date?
The party not meeting the deadline is in default.
What does it mean when a buyer waives his or her rights?
It tells the seller that the buyer has declined to exercise his or her rights regarding some particular aspect of the agreement.
What is covered in Paragraph 12. Buyer’s Due Diligence/Inspections?
Seller will provide access for inspection and will have utilities turned on during inspections. The buyer may make two pre-settlement walkthroughs of the property to be sure the property condition is as the agreement requires. Both the buyer and seller will have access to inspection reports.
All inspections are non-invasive, unless otherwise agreed in writing.
For all elected inspections, the buyer will complete the inspections in the contingency period, obtain the reports, and then accept the property, terminate the agreement, or submit a written corrective proposal to the seller.
